President Donald Trump’s budget proposals have been comprehensively covered in the U.S. media.

There is clearly an attempt to balance the budget through significant cuts to social safety-net programs such as Medicaid and food assistance, The Wall Street Journal reports.

For investors, there are a few questions that arise from Trump's budget plan:

• Does Trump have at present the political capital to be able to get such measures through Congress?
• What would be the economic impact?
• What would be the social impact?

The first is questionable. Very few presidents have had the authority to get their proposals through unchallenged, and the controversial nature of these proposals combined with the “Russian question,” makes the budget as suggested unlikely to pass.

The second is a relative shift as it is clearly something that works to lower the spending power of lower-income groups and therefore creates a shift in relative spending patterns.

The third issue is most difficult to know. Lower-income people are generally less likely to vote, but in today’s world of social media there are now different ways in which political pressure can be applied.

In the U.S., we have speeches from two FOMC voting members with Minneapolis Fed President Neel Kashkari, who is considered as a dove, and Philadelphia Fed President Patrick Harker, who is considered as a hawk.

Wednesday, we have the release of the Fed minutes of the May 2-3 Federal Open Market Committee (FOMC) meeting, which could overshadow what Mr. Kashkari and Mr. Harker are going to say today and notwithstanding they may give more insight into the scope for a rate rise in June, and let’s hope, how the Fed’s policy position is changing.

The shifts toward quantitative tightening, which in my opinion still could be expected at some time during the second half of this year, are of most interest.

There is also a question about how the Fed might react to fiscal policy changes, such as those being outlined by Trump at the moment. However, the underlying economic strength of the U.S. economy is probably enough to keep the Fed on course to tighten both monetary and quantitative policy.

Directly related to this, it might be interesting for investors to take note that the just released U.S. industrial production index showed a post-recession high for manufacturing output.

In addition, we also got the N.Y. Fed Nowcast that now expects U.S. GDP growth at 2.3 percent in Q2.

Besides all that, Japan released its trade data, showing exports to the U.S. increased by 2.6 percent y/y due to larger shipments of cars and auto parts.

This raises some interesting questions:

• It shows support for the Japanese economy in the absence of much happening on domestic demand.
• It raises questions again about the first quarter U.S. GDP economic data because also export figures from other countries are seemingly indicating a reasonably good level of international demand (trade) during Q1 of 2017 and that was not evident in the first release of the U.S. first quarter GDP data. On Friday we will get the first revision of the first quarter U.S. GDP data and interesting changes in the data can be expected.  

Over in Europe, the Ecofin group  of finance ministers meets in Brussels, which is at the best of times a fairly dispiriting occasion.

Nevertheless, there is the possibility of some interest around the U.K. exit (Brexit) discussions, which have not formally started yet, but where the rhetoric is already being cranked up.

The U.K. government is suggesting that it really does mean it when it says it may just walk away from the talks if the European Union doesn’t drop its demands for a divorce payment (Brexit) as high as 100 billion euros or about $112 billion.

Etienne "Hans" Parisis is a bank economist who has advised global billionaires and governments on the financial markets and international investments.